Oxford & The Sustainable Trade Index
The Sustainable Trade Index (STI) is a comprehensive framework designed to measure the capacity of global economies to achieve sustainable growth through international trade.
What is the Sustainable Trade Index?
The Sustainable Trade Index is a data-driven ranking that evaluates how effectively 30 major economies manage the trade-offs between economic growth, social equity, and environmental protection. Developed through a partnership between the Hinrich Foundation and the IMD World Competitiveness Center, with analytical support from Oxford Economics, it uses 72 indicators to identify which nations are best prepared for long-term global trade resilience.
Contrary to some common misconceptions, the index is not a standalone Oxford product; it is primarily the flagship research of the Hinrich Foundation, produced in partnership with the IMD World Competitiveness Center. Oxford Economics acts as a frequent collaborator and contributor, providing the rigorous economic modeling and forecasting data that underpin the index’s forward-looking insights.
1. The Three Pillars of Sustainable Trade
The STI evaluates economies across three "pillars." This structure recognizes that for trade to be truly sustainable, it must balance profit with people and the planet.
| Pillar | Key Focus Areas | Representative Indicators |
| Economic | Readiness for growth and innovation. | Trade costs, infrastructure quality, and export diversification. |
| Societal | Human capital and social equity. | Labor standards, income inequality, and educational attainment. |
| Environmental | Stewardship of natural resources. | Renewable energy share, carbon intensity, and waste management. |
2. Key Findings (2025 Edition)
The 2025 report highlights a shift from "globalization" to "fragmentation." Strategic trade is no longer just about efficiency; it is now defined by three critical trade-offs:
Efficiency vs. Strategic Autonomy: Nations are moving away from the "cheapest possible" supply chain to favor "reliable and domestic" partners.
Profitability vs. Social Cohesion: Economies recognize that export growth is unsustainable if it leads to extreme wealth inequality.
Climate Ambition vs. Development Sovereignty: There is growing tension between advanced economies' green standards and developing nations' economic needs.
3. Why Oxford Economics is Involved
While the Hinrich Foundation defines the mission, Oxford Economics provides the analytical "engine." They use their Global Economic Model to:
Forecast Trends: Predicting how changes in tariff policies or climate regulations will affect GDP.
Scenario Analysis: Helping businesses understand the impact of a total trade decoupling between major powers.
Quantify Impact: Measuring the specific social and environmental footprint of trade activities on local communities.
Leading Economies: 2025 Sustainable Trade Index Scorecard
The 2025 Sustainable Trade Index (STI), produced by the Hinrich Foundation in partnership with the IMD World Competitiveness Center and Oxford Economics, marks a historic shift in the global rankings. For the first time, the United Kingdom has secured the #1 position, ending the three-year dominance of New Zealand.
The rankings are derived from 72 indicators across three core pillars. Below is the scorecard for the top 10 performing economies.
2025 Global Scorecard: Top 10 Economies
| Rank | Economy | Overall Score | Economic Pillar | Societal Pillar | Environmental Pillar | Change |
| 1 | United Kingdom | 100.0 | 86.4 | 89.4 | 100.0 | +1 |
| 2 | New Zealand | 97.0 | 77.3 | 92.7 | 99.0 | -1 |
| 3 | Australia | 93.3 | 80.3 | 100.0 | 80.0 | = |
| 4 | Singapore | 90.0 | 99.5 | 86.6 | 66.6 | = |
| 5 | South Korea | 87.2 | 95.8 | 84.5 | 65.9 | +2 |
| 6 | Hong Kong, SAR | 83.8 | 100.0 | 65.5 | 72.8 | -1 |
| 7 | Japan | 83.5 | 67.8 | 78.5 | 91.2 | -1 |
| 8 | Canada | 80.5 | 74.4 | 96.8 | 59.4 | = |
| 9 | United States | 79.5 | 94.1 | 67.7 | 66.6 | = |
| 10 | Taiwan | 77.9 | 75.2 | 80.6 | 68.8 | = |
Pillar Leaders & Regional Highlights
🌍 The Environmental Champion: United Kingdom
The UK’s rise to the top was fueled by a perfect score of 100 in the Environmental Pillar. This reflects aggressive carbon neutrality targets, world-leading green finance mechanisms, and a significant reduction in per capita emissions.
🛡️ The Societal Gold Standard: Australia
Australia remains the global benchmark for the Societal Pillar, achieving a 100 score. This is driven by high labor standards, public trust in trade institutions, and robust social mobility, which are increasingly seen as the "antidote" to political instability caused by trade fragmentation.
⚡ The Economic Powerhouse: Hong Kong & Singapore
In terms of raw economic readiness, Hong Kong and Singapore continue to lead. Singapore’s score of 99.5 in the Economic Pillar highlights its role as the world's most open and digitally integrated trading hub, though both economies face challenges in balancing this with environmental land constraints.
📈 Asia’s Rising Star: South Korea
South Korea jumped two spots to #5, signaling a deep commitment to "sustainable industrial policy." Their score is bolstered by massive investments in renewable technology and semiconductor sustainability, positioning them as a leader in the green tech supply chain.
Key Trend: In 2025, the index identifies a transition from "resilience" to "economic unilateralism." Top performers are those that can maintain open trade (Economic Pillar) while protecting their social fabric (Societal Pillar) and meeting climate obligations (Environmental Pillar).
Key Performance Indicators (KPIs) of the Sustainable Trade Index
The Sustainable Trade Index (STI) is built upon a rigorous framework of 72 individual indicators. These Key Performance Indicators (KPIs) are categorized into three fundamental pillars to evaluate whether an economy's trade practices are truly sustainable in the long term.
1. The Economic Pillar: "Capacity to Grow"
This pillar measures an economy’s ability to foster growth through international trade while maintaining resilience against external shocks.
| KPI Category | What it Measures |
| Trade Infrastructure | The quality of ports, roads, and digital connectivity (e.g., 5G and broadband) that facilitate the movement of goods and services. |
| Innovation & Tech | Research & Development (R&D) spending and the capacity to produce high-tech, sophisticated exports. |
| Export Diversification | How broad a country's export basket is. High concentration in one sector (like oil) reduces the score. |
| Trade Costs | The efficiency of customs, the level of tariff barriers, and the ease of cross-border transactions. |
| Financial Stability | Inflation control, current account balances, and exchange rate stability. |
2. The Societal Pillar: "Human Capital & Equity"
This pillar assesses the social foundations that ensure trade benefits a broad segment of the population and maintains public support.
| KPI Category | What it Measures |
| Labor Standards | Enforcement of fair wages, safe working conditions, and the prevention of child or forced labor. |
| Social Mobility | The ability for citizens to move between socio-economic classes, often measured via educational attainment. |
| Equality | Income distribution (Gini coefficient) and gender equality in the workforce (Female Labor Force Participation). |
| Public Health | The quality of healthcare systems and "Workforce Resilience"—an economy's ability to keep its workers healthy and productive. |
| Political Stability | The absence of violence and the presence of a stable legal environment for trade. |
3. The Environmental Pillar: "Stewardship & Externalities"
This pillar measures how well an economy manages its natural resources and mitigates the environmental damage caused by trade.
| KPI Category | What it Measures |
| Carbon Intensity | CO2 emissions relative to GDP growth. High-growth trade must be decoupled from high emissions. |
| Air & Water Quality | Levels of particulate matter (PM2.5) and the percentage of wastewater treated before disposal. |
| Resource Dependence | The extent to which an economy relies on exporting non-renewable natural resources. |
| Renewable Energy | The share of renewables in the total energy mix used for manufacturing and transport. |
| Environmental Standards | Participation in international environmental treaties (like the Paris Agreement) and domestic green regulations. |
Summary of the 2025 KPI Weights
While each of the 72 indicators is meticulously tracked, the STI uses a rescaled scoring system (0–100).
A score of 100 represents the global benchmark for that specific KPI.
A score of 0 represents the lowest performance among the 30 economies studied.
Key Organizations Behind the Sustainable Trade Index
The Sustainable Trade Index (STI) is not the work of a single entity but a high-level collaboration between philanthropic, academic, and economic research organizations. Each partner brings a specific expertise—ranging from policy advocacy to rigorous statistical modeling—to ensure the index is both credible and actionable.
1. The Hinrich Foundation (Lead Partner)
The Hinrich Foundation is an Asia-based philanthropic organization dedicated to advancing mutually beneficial and sustainable global trade.
Role: As the primary sponsor and visionary, the Foundation defines the mission of the index. They use the STI to advocate for trade policies that support long-term prosperity rather than short-term gains.
Focus: They emphasize the importance of "balanced" trade—ensuring that economic growth does not come at the expense of social equity or environmental health.
2. IMD World Competitiveness Center (Co-Publisher)
The IMD World Competitiveness Center (WCC), a part of the prestigious IMD Business School in Switzerland, is a world leader in ranking the competitiveness of nations.
Role: IMD provides the academic framework and methodology. They apply their decades of experience in benchmarking national performance to ensure the STI meets the highest standards of data integrity.
Focus: They bridge the gap between business leadership and public policy, helping CEOs and government officials understand how to navigate a fragmented global trade environment.
3. Oxford Economics (Analytical Engine)
While the index is published by Hinrich and IMD, Oxford Economics acts as the primary analytical and modeling partner.
Role: Oxford Economics provides the massive data sets and "Global Economic Model" that power the index. Their team of economists conducts the deep-dive statistical analysis and produces the forward-looking forecasts.
Focus: They quantify the "what if" scenarios, such as how shifts in carbon-border taxes or regional trade blocs will impact a country’s future sustainable trade ranking.
4. History of Collaboration
The index has evolved through different partnerships over the years to keep pace with changing global dynamics:
2016–2020: The index was originally developed by the Economist Intelligence Unit (EIU) in commission for the Hinrich Foundation.
2022–Present: The partnership shifted to IMD and Oxford Economics to better reflect the intersection of national competitiveness and advanced economic modeling.
Regional Partners: Organizations like the Economic Research Institute for ASEAN and East Asia (ERIA) often collaborate on regional launches to provide localized context for Southeast Asian economies.
Why this Partnership Matters
The "Oxford-Hinrich-IMD" ecosystem ensures that the index is more than just a list of rankings. It provides:
Philanthropic Independence: Ensuring the research isn't swayed by corporate or government lobbying.
Academic Rigor: Providing a methodology that is respected by scholars and international organizations (like the WTO).
Real-World Application: Offering data that businesses can use to vet their supply chains for environmental and social risks.
Data & Methodology: Powering the Sustainable Trade Index
The Sustainable Trade Index (STI) is a data-driven framework that relies on a rigorous collection process to ensure its rankings are objective and actionable. By utilizing 72 unique indicators, the index provides a granular view of how 30 major global economies manage the complex intersections of trade and sustainability.
1. Primary Data Sources
The STI does not generate its own raw data through surveys. Instead, it aggregates and harmonizes high-quality data from the world's most respected international organizations. This ensures that the results are based on verified, globally comparable statistics.
Multilateral Organizations: Core data is sourced from the World Bank, International Monetary Fund (IMF), and the World Trade Organization (WTO).
Labor & Social Data: Indicators regarding labor rights and workforce demographics are pulled from the International Labour Organization (ILO) and UNESCO.
Environmental Metrics: Data on carbon emissions, renewable energy, and air quality come from the International Energy Agency (IEA) and the Yale Environmental Performance Index (EPI).
Specialized Intelligence: Proprietary economic datasets from Oxford Economics and the IMD World Competitiveness Center are used to fill gaps in trade forecasting and technological readiness.
2. The 72-Indicator Framework
The index is unique because it moves beyond simple GDP or export volume. The data points are split into three pillars to capture a holistic view:
| Pillar | Number of Indicators | Example Data Points |
| Economic | 24 | Tariff barriers, export concentration, R&D spending, and digital infrastructure quality. |
| Societal | 24 | Gini coefficient (inequality), labor rights protection, and educational attainment levels. |
| Environmental | 24 | CO2 emissions per capita, deforestation rates, and waste management efficiency. |
3. Data Processing & Normalization
Because the 72 indicators use different units (e.g., dollars, percentages, or CO2 tons), the index employs a specific mathematical process to make them comparable:
Normalization: Raw data is converted into a 0–100 scale. A score of 100 represents the "frontier" or the best possible performance observed across the 30 economies.
Weighting: Each of the three pillars (Economic, Societal, and Environmental) is weighted equally at 33.3% of the final score. This prevents a country from "buying" a high ranking through economic power alone if they are neglecting social or environmental standards.
Modeling by Oxford Economics: Oxford Economics applies its Global Economic Model to adjust for "outliers" and to ensure that the data reflects long-term structural trends rather than temporary seasonal fluctuations.
4. Why This Data Matters
By using such a broad range of data sources, the STI prevents "Greenwashing." A country cannot rank highly by simply having a large renewable energy sector (Environmental) if they utilize forced labor in their supply chains (Societal) or maintain closed, non-competitive markets (Economic).
Conclusion: The Future of Trade is Balanced
The Sustainable Trade Index (STI) marks a definitive shift in how we define global economic success. As we navigate 2026, the index has evolved from a simple academic exercise into a strategic compass for a world defined by "permanent uncertainty."
Key Takeaways
The transition from 2025 into 2026 highlights that the era of "efficiency-at-all-costs" has ended. The top-performing nations—led by the United Kingdom, New Zealand, and Australia—are those that have successfully balanced three competing priorities:
Strategic Autonomy: Reducing over-reliance on single partners to build resilience.
Social Cohesion: Ensuring trade benefits the many, not just the few, to prevent political instability.
Environmental Stewardship: Decoupling economic growth from carbon intensity to meet urgent climate targets.
The Oxford-Hinrich-IMD Impact
Through the partnership of the Hinrich Foundation, IMD, and Oxford Economics, the STI provides the high-fidelity data needed to cut through the "noise" of modern trade. It reminds us that sustainability is no longer an optional "extra" or a corporate social responsibility initiative—it is a fundamental driver of national competitiveness.
Frequently Asked Questions: Sustainable Trade Index (STI)
The Sustainable Trade Index is a complex tool used by global leaders to navigate the intersection of commerce and ethics. Below are the most common questions regarding its purpose, methodology, and 2025 findings.
1. General Overview
Q: What exactly is the Sustainable Trade Index?
A: The STI is an annual ranking of 30 major global economies. It measures a country’s capacity to trade in a way that balances economic growth with social equity and environmental health. It is published by the Hinrich Foundation and the IMD World Competitiveness Center, with data modeling by Oxford Economics.
Q: Why does the index matter for businesses?
A: For corporations, the STI serves as a risk-assessment framework. It helps companies identify which countries have stable labor markets, reliable infrastructure, and forward-thinking environmental regulations, making them safer long-term bets for supply chain investments.
2. Rankings & Performance
Q: Who is the top-ranked country in 2025?
A: The United Kingdom is the #1 ranked economy in 2025. It climbed to the top spot primarily due to its perfect score in the Environmental Pillar, overtaking New Zealand, which had held the lead for the previous three years.
Q: Why do some wealthy economies rank lower than expected?
A: High GDP does not guarantee a high STI rank. For example, some wealthy nations score poorly if they have high carbon emissions per capita (Environmental) or significant income inequality (Societal). The index rewards balance across all three pillars, not just raw economic power.
3. Methodology & Data
Q: How is the score calculated?
A: The final score is an average of 72 individual indicators grouped into three pillars: Economic, Societal, and Environmental. Each pillar is weighted equally (33.3%) to ensure that a "sustainable" trade profile requires excellence in all three areas.
Q: Where does the data come from?
A: The index uses "hard data" from international organizations like the World Bank, UN, WTO, and ILO. This is supplemented by proprietary modeling from Oxford Economics to ensure the data is normalized and reflects long-term trends rather than temporary market fluctuations.
4. Key Trends for 2025
Q: What is the "Fragmentation" mentioned in the 2025 report?
A: "Fragmentation" refers to the shift away from global, rules-based trade toward smaller, "trust-based" trade blocs. The 2025 report highlights that countries are increasingly prioritizing strategic autonomy (self-sufficiency) over the old goal of pure efficiency (lowest cost).
Q: What is "Green Protectionism"?
A: This is a major theme in 2025. It refers to a tension where advanced economies use environmental standards (like carbon taxes) as trade barriers. While good for the planet, developing nations often view these as unfair hurdles that hinder their own industrial growth.
5. Access & Use
Q: Can I use this data for my own research?
A: Yes. The Hinrich Foundation typically provides interactive tools and executive summaries on their website. Researchers often use the STI’s 72 indicators to benchmark specific policy impacts, such as how new labor laws affect a country's trade competitiveness over time.
Glossary of Terms: Sustainable Trade Index
To fully grasp the insights within the Sustainable Trade Index (STI), it is essential to understand the specific economic and geopolitical terminology used by the Hinrich Foundation, IMD, and Oxford Economics.
Core Pillars of Sustainability
The STI framework is built on three inseparable pillars. For trade to be considered "sustainable," an economy must achieve a balance across all three.
| Pillar | Definition | Strategic Goal |
| Economic | Measures the capacity to promote growth through international trade infrastructure and innovation. | Resilience: Building a diverse and technologically advanced trade base. |
| Societal | Evaluates the development of human capital, labor standards, and public support for trade. | Equity: Ensuring trade benefits are shared and do not exploit the workforce. |
| Environmental | Assesses the management of natural resources and the mitigation of trade-related externalities. | Stewardship: Decoupling economic growth from environmental degradation. |
Key Terminology & Indicators
The following terms represent the critical 2025–2026 themes and KPIs used to calculate the rankings.
| Term | Definition | Pillar Association |
| Carbon Intensity | The amount of $CO_2$ emitted per unit of GDP; tracks if an economy is becoming "greener" as it grows. | Environmental |
| Digital Trade Readiness | A measure of an economy's ability to facilitate paperless trade and cross-border data flows. | Economic |
| Efficiency vs. Autonomy | The trade-off between the lowest cost (efficiency) and supply chain security (autonomy). | Strategic Theme |
| Fragmentation | The shift from global trade to smaller, trust-based regional or "friend-shored" trade blocs. | Strategic Theme |
| Gini Coefficient | A statistical measure of income inequality used to assess social cohesion. | Societal |
| Green Protectionism | Environmental regulations used as "disguised" trade barriers against developing nations. | Environmental / Economic |
| Labor Standards | Compliance with international laws regarding fair wages and the elimination of forced labor. | Societal |
| Modern Slavery Risk | A metric assessing the likelihood of forced labor appearing in a country's export supply chain. | Societal |
| Normalization | The process of converting diverse units (dollars, tons, percentages) into a 0–100 scale. | Methodology |
| Social Mobility | The ability for citizens to improve their socio-economic status through education and trade. | Societal |
| Workforce Resilience | An indicator combining health coverage and education to measure a worker's ability to adapt. | Societal |
Understanding the Trade-offs
The 2025 report introduced "Foundational Trade-offs" that define how nations currently position themselves:
Selective Openness: Economies with low formal barriers (tariffs) but limited overall trade liberalization (e.g., Russia).
Progressive but Protected: Economies that maintain open systems but protect key domestic sectors (e.g., USA, Australia).
Balanced Growth: Achieving high profitability alongside high social inclusion (e.g., Singapore, South Korea).
Methodology Note: The STI utilizes 72 indicators in total. While "Economic" indicators often dominate traditional trade news, the STI weights all three pillars equally at 33.3% to ensure that a nation's ranking reflects its true sustainability, not just its wealth.
